Wills, Trusts, and Estates

Resulting Trust


A resulting trust is an equitable reversionary interest that arises by operation of law in two cases:

  1. An express trust fails or makes an incomplete disposition
    • Examples:
      • O gives X property in trust to pay the income to A for life, then to A's descendants. A dies without descendants. X becomes trustee of the property for O then. The remainder interest of the trust just results back.
      • O gives $10,000 in trust to pay $4,000 to A over 5 years. $6,000 reverts to being in trust for O.
  2. One person pays the purchase price for property and causes title to be taken in the name of another who is not a natural object of his bounty
    • Examples:
      • If A buys a farm but puts it in B's name, B becomes a trustee for A.
      • If A gives B money to buy a farm, B becomes a trustee for A.
      • If A gives B money to buy a farm or buys him a farm himself but says that the money/farm is a gift, A just owns the farm.

The trustee never gets the property.

The beneficiary of a resulting trust can demand to get the property in trust back. It does not have to be held in trust forever.